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PUC Alerting Electric Customers To 6.3% To 24% Increase In Winter Heating Bills If They Don't Shop For Energy Suppliers

On December 16, the Public Utility Commission alerted electric consumers about the potential for large winter energy cost increases if they do not shop for competitive electric suppliers.

To avoid the possibility of “sticker shock” from high bills during the coming cold months, the PUC reminds consumers that the start of winter is an important time to compare prices for electric generation and evaluate competitive supplier options.

Most Pennsylvania regulated electric utilities adjusted the price they charge for the generation portion of customers’ bills on December 1 for non-shopping (default service) customers, also known as the “Price to Compare” (PTC).

The PTC averages 40 to 60 percent of the customer’s total utility bill. However, this percent varies by utility and by the level of individual customer usage.

Recent changes in the price of electricity for default service range from a reduction of 6.3 percent to an increase of 24 percent.

As of December 1, electric distribution companies reported the following changes in their PTCs for residential customers:

-- Penelec, up from 5.198 cents to 6.445 cents per kWh (24%);

-- Penn Power, up from 6.231 cents to 7.572 cents per kWh (21.5%);

-- Met-Ed, up from 5.667 cents to 6.51 cents per kWh (14.9%);

-- Citizens’ Electric, up from 6.5016 cents to 7.0986 cents per kWh (8%);

-- West Penn Power, up from 5.338 cents to 5.76 cents per kWh (7.9%); and

-- PPL, up from 7.585 cents to 7.632 cents per kWh (less than 1%).

The PUC noted that several other electric utilities, including UGI, Duquesne Light, PECO and Wellsboro Electric, have reduced their PTCs by 6.3%, 4.2%,1.4% and 1% respectively, though the PUC still encourages customers to explore their options in those service areas.

In most areas of Pennsylvania, consumers can choose who supplies their electricity, based on price or other factors, such as renewable energy.

Customers not choosing a supplier continue to receive default service from their local utility, with the cost per kilowatt hour (kWh) set quarterly or semiannually based on electric generation procurement plans developed by those utilities.

The PUC does not regulate prices for the generation portion of electric bills, as generation is the production of electricity and not regulated by the Commission.

For those customers that do not shop, electric utilities obtain default generation service using a procurement process overseen by the PUC – the electric utility in effect “shops” for the customer.

Generation prices are separate from the closely regulated rates that utilities charge for their distribution services – the delivery of electricity to homes and businesses.

According to the PUC’s most recent electric switching report, more than 1.8 million (31 percent) residential and business customers currently have their electric generation provided by competitive suppliers – representing approximately 2/3 of the state’s regulated power load.

In the residential rate class, more than 1.5 million customers (about 24%) are enrolled with competitive suppliers.

PAPowerSwitch.com, the PUC’s nationally recognized website for electric choice, provides consumers with valuable information on how to shop for electric supply services. The website enables consumers to quickly compare offers from competitive suppliers.

As another alternative for default service customers not participating in the competitive electricity market, Pennsylvania’s regulated utilities offer a voluntary Standard Offer Program (Standard Offer) - providing those customers with the option of receiving service from a competitive supplier at a fixed-price that is 7 percent below the utility’s current PTC. The Standard Offer price is fixed for one year and can be canceled by the customer at any time with no early cancellation or termination fees.

For more information on changing electricity or natural gas suppliers, visit the PUC’s PAPowerSwitch.com website.

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